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What is a class action under the Fair Credit Reporting Act?

A class action is a legal device that allows individuals to recover civil damages without having to file their own individual lawsuits. In a class action lawsuit, a single individual or a small group of individuals, file the suit on behalf of everyone who was injured by the defendant’s illegal behavior. With the court’s approval, those individuals can seek to recover the total amount of money that is owed to everyone in the class. With the supervision of the court, the money that is recovered is distributed to everyone in the class, with the vast majority of class members never having to come to court or do anything else in the lawsuit.

Class actions are especially appropriate when individual damages are small, and where people are unlikely to file their own individual cases.

What is required of the defendant under the Fair Credit Reporting Act?

Under the Fair Credit Reporting Act, defendants can be required to pay statutory damages of between $100 and $1,000 for each willful violation of the Act. Plaintiffs are not required to prove out-of-pocket losses in order to recover statutory damages. Courts routinely recognize that it is unlikely anyone will sue to recover these relatively small amounts, and that class actions are therefore a good mechanism to ensure that defendants (which can be employers and consumer reporting agencies in Fair Credit Reporting Act cases) comply with the law.